Short interest theory

Definition:

The theory that a large interest in short positions in stocks will precede a rise in the market prices, because the short positions must eventually be covered by purchases of the stock.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

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An attempt to acquire a large portion of a company's stock to gain control by offering stockholders a premium over the market value for their shares.

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